Poland: Growth in 5.7% in 2021

The Polish economy grew better than expected, especially by 5.7% last year, at the fastest pace since 2007, according to preliminary statistics from the country’s statistical office, as it recovered from the coronavirus pandemic, according to Reuters.

Central European economies are looking to build on the 2021 recovery, driven by consumer demand, but face adversity such as global supply constraints that hit factory output in the second half of last year.

With inflation throughout the region at high multi-year levels, central banks, such as Poland, have all turned to interest rate hikes.

Data for Poland showed that domestic demand was strong in 2021.

“We know the economy closed last year at a very high level,” said Adam Antoniak, chief economist at ING Bank Slaski.

“We have a consumer boom, and that, in terms of monetary policy, combined with high inflation, is pushing for a further tightening of monetary policy.”

Growth in 2021 was above analysts’ average forecast of 5.5% in a Reuters poll and the fastest since GDP grew by 6.7% in 2007. The economy shrank by 2.5% in 2020.

The National Bank of Poland, which has been battling inflation for more than two decades at 8.6%, has raised its key interest rate by 215 basis points to 2.25% since October.

Source: Capital

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